Line IPO: Messaging App To List In Tokyo, New York In July

Line, Japan’s most popular messaging app, is set for a public listing in both Tokyo and New York starting July. The initial public offering (IPO), which is expected to raise about 100 billion yen ($936 million), would be the biggest so far this year in Japan and the United States.

The Tokyo Stock Exchange approved Friday the listing for July 15, and the New York Stock Exchange is also reportedly expected to approve the Line IPO later Friday. The sale of shares would value the company — a subsidiary of South Korean Naver Corp. — at about 600 billion yen.

The app offers free messages as well as voice calls, while generating revenue from advertising and sale of games and other digital content. It has also expanded its services by including music streaming and hailing taxis. At the end of March 2016, Line had 218 million active monthly users, according to the Wall Street Journal, more than half of which came from only four territories — Japan, Indonesia, Thailand and Taiwan.

Proceeds from the IPO are expected to be used to expand its range of services in existing markets, as well as to expand to new markets. The company also has plans to enter the low-price smartphones business. Line had reported a net loss for 2015 but has forecast a return to profitability this year. AppAnnie listed Line as the top non-gaming publisher, in terms of earnings, for 2015.

Naver, South Korea’s largest internet portal, owns 100 percent of Line and will likely retain its roughly 80 percent stake in the company even after the dual listing. It has appointed Nomura Securities and Morgan Stanley as lead managers for the IPO. In Tokyo, 13 million shares will be traded starting July 15, while another 22 million shares will likely be offered in New York, starting July 14.

A Yonhap report said there has been speculation that the main reason for the IPO was to allow managers and employees of Line to profit from their stock options, which can be realized only after the company is listed publically.